Canadian Fulfillment: Third-Party Logistics Explained

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As the owner of a small Canadian e-commerce business, I am always on the lookout for ways to save money without sacrificing customer satisfaction. When I manage to stumble across a way to cut costs and improve customer service, I know I have found a winner. This is exactly what happened when I took the plunge and joined forces with a third-party Canadian fulfillment company.

Honestly, it was the perfect way to take my business to the next level without sacrificing quality. Now you can do the same.

What Is Third-Party Fulfillment?

Any company that is a Canadian fulfillment service ultimately describes a company that receives and ships orders on your behalf. As you know, most small businesses start off by buying products in bulk, and then shipping them out to individual customers when they receive an order. In fact, I suspect that if you are reading this article, this is very similar to your own business model.

Now, this works really well on a small scale. However, as your business grows, this becomes more challenging.

You might be required to invest into more warehouse space to store all your products. You might also have to hire more staff so that you can manage an increasing number of orders in a time efficient manner. All of which comes at an increased cost that is then passed onto your customers. Which is where Canadian fulfillment enters the discussion.

These large companies have warehouse facilities that can store your stock. Then, when you receive an order, they actually ship them out to your individual customers on your behalf.  This eliminates the need for more staff and more space.

What Does a Canadian Fulfillment Company Do?

I have already outlined this in some detail, but I want to clarify. Third-party Canadian fulfillment companies act as the central location for all your stock storage, order packaging, processing, and shipping needs.

When you receive an order through your e-commerce website, they are notified. They then proceed to pack your order, and send it out to the customer without the need for any direct communication with you.

Furthermore, they also increase your capacity to store products without having to invest in more warehouse space. And as many of these companies have distribution centers all over Canada, they can even speed up your shipping times.

What Are the Benefits of Canadian Fulfillment?

I think it is pretty apparent that one of the biggest benefits associated with seeking aid from a Canadian fulfillment company is more money in your pocket. I mean, when I took one on, I spent less money on storage and didn’t have to hire more staff. This was an obvious win-win.

However, there were also a number of unique benefits that I didn’t expect.

Firstly, I began to save time by not having to process, pack, and physically ship orders. While I didn’t realize it at the time, I spent a huge part of my day performing these somewhat mundane tasks. However, once they were gone, I had more time to invest into marketing, researching new products, and improving my customer support. All of which improved my revenue in a extremely real way.

Secondly, I no longer had to invest in warehouse space. While this obviously reduced my yearly expenses, it also meant that I no longer had to sign up for long-term leases for those warehouses. This improved my stress levels significantly. Knowing that I had a space leased for 24 months meant that I had to earn a certain amount to simply pay my rent. Once that pressure was gone, I saw a rapid improvement in my mental health.

Finally, my customer service actually improved when I outsourced my shipping process. I simply could not compete with the speed and efficiency that the fulfillment company packed and processed orders.

This meant my customers got their products quicker, making them happier in the process.

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What Does Third-Party Canadian Fulfillment Cost?

It is important to note that when it comes to specific costs, each third-party Canadian fulfillment center is slightly different. However, most typically charge either by the hour or per unit of product shipped.

This means that the cost is directly related to the amount of product that you sell, which seems like a fairly logical process. Moreover, it is not uncommon for fulfillment companies to reduce their cost per unit when you start using them a lot.

You can think of this as a way to incentivize good customers.

While this initial increase in cost might come as a surprise to some, once you account for the money you save on shipping, storage, and additional staff, you end up saving a lot of money in the long run.

Final Thoughts

If you run an e-commerce business and you are looking to save money, then third-party Canadian fulfillment is the answer. 

Not only will it mean you spend less money on shipping, storage, and staff, but it also creates more time that you can spend growing your business. That is a huge win-win if I have ever seen one.

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The post Canadian Fulfillment: Third-Party Logistics Explained appeared first on Business Opportunities.

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